Thursday, September 18, 2014
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Aereo decision shows court's protectionist side

Glenn Garvin

is a Miami Herald columnist

When the Supreme Court effectively outlawed the online TV service Aereo last month, the first temptation was to dismiss the ruling as the confused ravings of a bunch of old people confounded by this newfangled Interweb stuff.

This interpretation was bolstered by a question from Justice Sonia Sotomayor during oral arguments about the case's possible ramifications for "iDrop in the cloud," which might have been an addled reference to the Web data storage site Dropbox, or might have been the consequence of some missed meds.

But the sad fact is the decision to shut down Aereo (which, indeed, suspended service a couple of days after the court's ruling) is the latest in a long series of protectionist moves by the federal government aimed at preserving monopolies in the TV business at the expense of viewers.

For many years the primary target of the government attacks was cable TV, which the Federal Communications Commission forthrightly said it didn't want "siphoning off" viewers from broadcast television. Using everything from restrictions on microwave relays to bans on original content, the government effectively stifled the development of cable for three decades.

Now, ironically, the target is a new approach that uses broadcast technology to rescue consumers from predatory cable operators. Aereo, which started up in 2012, offered itself as an alternative to the loony prices of cable TV: For $8 a month, customers got two dozen or so channels, mostly their local broadcast stations, and the ability to record them to watch at their leisure.

Aereo could provide its service so cheaply because it wasn't paying the exorbitant so-called retransmission fees that the broadcast networks charge cable companies to carry their signal. Aereo is not a cable company; it picks up the broadcast signals from the air, using huge banks of tiny antennas at a central location, one antenna assigned to each customer.

Their signals are then stored on a server and relayed to customers through the Internet - instantly, if they want it; later, if they prefer to time-shift.

Aereo doesn't do anything you couldn't legally do at home by putting an antenna on the roof and hooking it up to a DVR. The company just performs those services for you with little muss, fuss, or expense.

But "expense" is what the TV and cable industries are all about. They've existed for decades in a cozy monopolistic co-dependency created by local governments, which in almost every town in America awarded one cable company an exclusive franchise in return for a cut of the swag.

The predictable result has been an ever-upward spiral of prices: The average U.S. household monthly cable bill is expected to hit $200 by the end of the decade.

With that kind of booty at stake, the TV industry attacked Aereo with a vengeance. And the Supreme Court agreed with the monopolists. Forget all those bothersome "behind-the-scenes technological differences," wrote Justice Stephen Breyer in his majority opinion. If it kinda looks like a cable company, we'll treat it like one.

A dumbfounded Antonin Scalia, in dissent, accused the court's majority of "guilt by resemblance," which he warned will complicate decisions on new technologies for years to come.

First candidate: those cloud-based data storage services. If you store movies, music, or anything that's been copyrighted in one of their accounts, by the standards of the Aereo decision, you are witnessing a "performance" every time you access your account, and the copyright holder could charge you for it.

Breyer wrote that cloud-storage services won't be affected by the Aereo decision because, well, he says so. He didn't offer a single shred of reasoning as to the difference. Then again, he didn't offer any reason why Aereo is different from a host of other technologies that help you watch television.

If you use a rooftop antenna, why shouldn't you have to pay CBS for the "performance" as it relays the signal down to your set? For that matter, why not pay CBS royalties for the set itself, which converts electromagnetic waves into images that are streamed to your eyes and ears. Isn't that a performance, too?

I'm being facetious, of course. Sadly, Breyer isn't.

 


ggarvin@miamiherald.com

Glenn Garvin MIami Herald columnist
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